Indian equities trim losses; trade gyrates near neutral line

Indian equities trimmed loss to continue its lackadaisical trade gyrating near neutral line in the late afternoon session taking clues from European counterparts. Traders were seen piling up position in Health Care, Auto and PSU sector while selling was witnessed in Power, TECk and Realty sector. In the scrip specific development, Bharti Airtel was trading under pressure after Credit Suisse downgraded the stock, citing the prospect Reliance Infotel would enter the wireless voice market. Credit Suisse has cut its ratings on the stock to ‘underperform’ from ‘neutral’. Pantaloon Retail, the flagship company of Future Group, was trading in red after the Competition Commission of India (CCI) rejected the notice seeking nod for the Aditya Birla - Pantaloon deal. Essar Oil is trading firm in green on reports that the company has entered into $1.2 billion pact with Colombia to buy crude oil. FDC was trading in green after the company announced buyback at maximum Rs 110 per share.

On the global front, the Asian markets were trading in red barring KLSE Composite while the European markets were trading on pessimistic note. Prime Minister Jean-Claude Juncker, head of the group of euro-zone finance ministers will meet with Greek Prime Minister Antonis Samaras today in Athens, and French President François Hollande and German Chancellor Angela Merkel will meet tomorrow in Berlin. In economic news, German leading economic index decreased in June and the UK public sector net borrowing increased in July. On the home turf, the NSE Nifty and BSE Sensex were trading above their psychological 5,400 and 17,800 levels respectively. The market breadth on BSE was positive in the ratio of 1364:1304 while 148 scrips remained unchanged.

The BSE Sensex is currently trading at 17882.89, down by 2.37 points or 0.01% and touched a high and a low of 17,895.79 and 17,800.29 respectively. There were 17 stocks advancing against 13 declines on the index.

The broader indices continued to trade in green; the BSE Mid cap and Small cap indices were up by 0.12% and 0.15% respectively.

The top gaining sectoral indices on the BSE were, Health Care up by 0.77%, Auto up by 0.41%, PSU up by 0.38%, Metal up by 0.35% and Bankex up by 0.35% while, Power down by 0.61%, TECk down by 0.23%, Realty down by 0.17%, Oil & Gas down by 0.10% and Capital Goods down by 0.07% remained top losers on the index.

The top gainers on the Sensex were Dr Reddy’s Lab up by 1.84%, Hindalco Industries up by 1.25%, Hero MotoCorp up by 1.02%, Bajaj Auto up 0.99% and Sun Pharma up by 0.90%.

On the flip side, Bharti Airtel down by 2.98%, Tata Power down by 1.05%, GAIL India down by 1.04%, NTPC down by 1.04% and HDFC down by 0.94% were top losers on the Sensex.

Meanwhile, despite stringent rainfall and an expected fall in sugar production in the current marketing year starting October 2012, the Central government has confirmed that there is no proposal to ban sugar exports. About 1.35 million tonne sugar has been exported this year so far.

Earlier, the Food Ministry had planned to restrict sugar exports so as to control the rising retail prices, which had hit Rs 37-45 a kg in metros. The sugar prices started climbing up as the production lacked due to deficient rainfall in sugar cane producing states such as Maharashtra and Karnataka.

Sugar production is expected to be 26 million tonnes in the ongoing 2011-12 marketing year, and forecasts nearly 25 million tonne for the next marketing year starting October 2012. In May, the Centre had freed sugar exports and took it under the Open General License (OGL).

The S&P CNX is currently trading at 5,422.80, up by 1.80 points or 0.03% and touched a high and a low of 5,426.90 and 5,394.80 respectively. There were 31 stocks advancing against 19 declines on the index.

The top gainers of the Nifty were Ranbaxy Laboratories up by 3.34%, BPCL up by 2.79%, Dr Reddy’s Laboratories up by 2.05%, Hindalco Industries up by 1.11% and Hero MotoCorp up by 1.06%.

On the flip side, Bharti Airtel down by 3.11%, IDFC down by 1.28%, Tata Power down by 1.10%, NTPC down by 1.06% and GAIL India down by 1.06%, were major losers on the index.

Most of the Asian markets continued to reel under pressure; Shanghai Composite declined by 0.50%, Hang Seng plunged 1.06%, Nikkei 225 lost 0.27%, Straits Times slid 0.46%, Kospi Composite edged lower by 0.41% and Taiwan Weighted shed 0.14%. On the other hand, KLSE Composite up by 0.09% was the only gainer amongst the Asian pack. Jakarta Composite is closed due to Idul Fitri holidays.

The European markets were trading in red with, France’s CAC 40 descending 0.42%, Germany’s DAX dropped 0.72% and the United Kingdom’s FTSE 100 slipped 0.88%.